Combined revenues of the top-three Taiwan-based foundry houses are expected to top US$8.47 billion in the third quarter of 2014, increasing 13.4% from the previous quarter, according to Digitimes Research.

Optimizing a rebound in orders from chip suppliers for telecom, computer and consumer electronics devices, the top-three foundry houses managed to buck the seasonal trends in the second quarter and ramped up their combined sales by 22% sequentially to US$7.47 billion in the second quarter.

In addition to replenishing their inventories, chip vendors including Qualcomm, Broadcom and MediaTek have also started taking pull-in orders for 4G LTE chips in preparation for an anticipated sales boom for 4G smartphones in the second half of 2014, driving up demand for 28nm production capacity at Taiwan Semiconductor Manufacturing Company (TSMC) and United Microelectronics Corporation (UMC).

Due to strong demand from the mobile device sector, TSMC has not only continued to expand its 28nm capacity but has also ushered its 20nm process into volume production in the second quarter of 2014. Meanwhile, UMC has also begun its 28nm PolySiON process in the second quarter, contributing 1% to its total revenues in the quarter.

Digitimes Research believes that the ratio of revenues generated by the advanced 28nm and below processes to total revenues of the top-three foundry houses will leap significantly in the third quarter of 2014 as compared to the previous quarter. ASPs will also pick up in the third quarter due to improvements in product mixes.

Content from this blog post was provided by the Digitimes Research Tracking team, which focuses on shipment data and market trends in the global mobile device supply chain. Digitimes Research provides quarterly tracking services for market sectors such as Global Tablet, China Smartphone, China Smartphone AP, China Touch Panel, Taiwan ICT and Taiwan FPD. Click here for more information about Digitimes Research Tracking services.